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Friday, January 09, 2009

New York Taxing the Internet

Remember back when you received bogus Email's claiming there was going to be a tax on the Internet? Ahhh… those were the good ol’ days. It has taken a while but it appears like the tax man is coming. It’s only a matter of time before other states follow New Yorks lead.

In the past only companies that had actual offices in New York State were required to collect sales tax on purchases by New York residents. This is typically the case in many states. Last year New York informed companies like Amazon they were required to collect tax on from New York resident because they had “affiliates” in the state. While companies lobbied hard against this tax, they failed. Just last month I was notified by one of the companies who broker affiliate deals that I wasn’t wanted.

Dear element 5 / share-it! Affiliate,

We have been working diligently over the last several months to find ways to continue our relationship with you given the new tax laws recently enacted. Unfortunately, at this time and effective immediately, we are no longer able to allow any New York based affiliates to participate in our affiliate program. We look forward to resuming our relationship in the future if the situation allows.

To make matters worse our current un-elected Governor Paterson has proposed to solve New Yorks budget problem by adding more taxes on the Internet. It’s called an “iTax” and will apply an 8% tax on any music that is downloaded. Our local assemblyman Jim Tedisco has even created a YouTube video to air his dissatisfaction with the proposed tax.

If you think this tax is unbelievable the governor has also asked for a Fat Tax on soda and other beverages which contain sugar. New Yorks Health Commissioner Richard Daines has taken to YouTube to make his case.